Bob Frigo & john, leeds

Check out Anatole Kaletsky's latest piece for more of the same. Seems to me that The Times is proud of the record of there financial columnists as contra-indicators. When these two see sunny days ahead get your umbrella and be afraid, very afraid.

Stratford Tony, Salisbury, UK

Housing IS the UK economy..

Richard, Bucharest,

There is a difference between a correction and a crash.

House prices are just correcting slightly, this is a good thing for the economy, much better than a boom bust situation.

The problem is house prices are such a sensitive issue in the UK as soon as prices move at all it is big news.

Rob, UK,

David N, no he won't build 3m homes!
Horward, cost/earnings (tick), price/earning (cross).
Mark, FTB and average house don't go together.
George, who cares about the Euro. Not me and not most in Ealing.
Chris, it's a global economy. Exports of goods and services. Growing incomes (still growing!).

AndyG, London, UK

House prices may well fall back to a 3.5 x salary multiple. It all depends upon what banks are now willing to lend. 125% mortgages, lie-to-buy, 7x salary multiples etc explain the spectacular rise in house prices in the past. Take away the credit and demand will crash, and with it prices.

Nigel Watson, Guildford,

This, once again, raises the question - just how massively, humiliatingly, publicly wrong do you have to be before people stop considering you an expert?

clearly too long...

Bob Frigo, Bristol, UK

Before the last crash the house I grew up in cost about £50,000. Now a young family would have to come up with over £220,000 to buy it. Oh, but interest rates are lower so thats alright then.

Ian, london,

has david smith ever been right? ($40 oil anyone)

just how wrong do you have to be before you are sacked from the times?

john, leeds,

The UK is sinking in a morass of debt, following years of reckless lending. All GB can come up with is "lets get it going again" and "borrow our way back to riches". New Labour have betrayed us, pretending we can live forever on the never-never. Please dont help them any more David.

Mike, Waikato, New Zealand

I think David is right and that house prices are not over-priced and do not need to come down at all.

Right, don't have time to write any more as Toto and I are off to see the Wizard, the wonderful Wizard of Oz.

Dorothy, Emerald City, Land of Oz, Oz

The impeding crash is a return to normality/sanity

the last few years of suicidal lending and borrowing will soon be seen as the irrational blip in an otherwise sane credit market.

Jin, London,

The issue of house prices long term is affordability.
You just cannot get away from that fact.
The current prices are artificially high - enabled by reckless lending and unsustainable low interest rates.
Watch low interest rates cripple the pound and hike up inflation and then ... rates.

J Schneider, Worthing, UK

Face it David - you've been wrong all along.

Tony Marshall, Fareham,

House prices will fall back to RPI-indexed pre-boom levels; in today's money closer to 50%. The longer this correction is drawn out the longer the UK will be in recession. A short-sharp crash will enable those who have been priced out for so long to get on with their lives as soon as possible.

Paul, Coventry,

The article doesn't comment on the longer term issue of taking on large debts. As first time buyers become older they will need to work for longer to pay the mortgage. Finding well paying jobs in later life is far more difficult. The reckless credit boom is going to impact the economy for years.

Costas, Cyprus,

I get fed up with commentators who wheel out the same old tripe about interest rates being far lower than they were in the last crash.

Homeloans are TWICE as big and payments eat up more of borrowers' salaries than they did then.

Come back in 6 months when repossessions are rocketing

Justin Thyma, london, uk

The price of credit both in general lending and mortgage based lending has not altered upwards then?

Any idiot can see availability has decreased, but take a moment to do a scan of loan rates now as compared to a couple of months in the UK ago you will see substantial increases.

No affect then?

Paul, London, Canada

We have taken on an additional 900 Billion in debt in just a few years to get where we are today. Therefore if things were to continue we would need to borrow a further 900 Billion. That to me indicates that 3 times earnings is a more prudent, averaging measure of affordability that what we have now

Paul, Blackpool,

If it looks like a duck and quacks like a duck then it probably is a duck. So, we are in a recession because people believe we are. House prices are the key to sentiment. BTL investors can bail out now CGT is 18%. GORDO is still going to build 3 million homes. And first time buyers ? No chance

David Nammory, Liverpool,

I can't help but feel that the dismissal of old price earnings ratios sounds like 'its different this time'. In 10 years buy to let has grown from 1% to about 11% as the bubble inflated. If you dismiss p/e try looking at yields instead and the result looks the same. is it different this time?

howard, london,

Dear David

I would like to suggest that a major issue is unemployment. As you rightly say that is a trailing indicator. I cannot see how in the short term or medium term unemployment can be avoided in the face of the loss of money provided for discretionary spendind by finance of all kinds.

Chris Stuart, Carentan, France

To me the BoE's liquidity fix violates EU competition rules. At the least their legality needs to be analysed. And BA wants exemption from these same rules, to do what cartels do - exploit customers - and what the law was set up to stop!

Noel Falconer MEcon, Couiza, France

"Will housing crush the UK economy?"
Housing should never have been allowed to inflate to the stage where it has become one of the largest threats to the country's economy in the first place.
What we are about to see however is a 50% reduction in UK property prices over the next 5 - 10 years.

Allan, Inverness,

Surely the Bank of England's "£50 billion" injection of liquidity is really only £25 billion given how quickly the Northern Rock is taking liquidity out of the market.

Leo McLeman, Glasgow, UK

David, I take it you have heard of Mortgage equity withdrawl, where people spend the value of their home on Tat in the high street. Well, I have sour news for you Jack, it only works if house prices are climbing. MEW contributed to 40 Billion in spending last year alone (Q1-Q4). BIG OUCH!

Sam Smith, Southport, UK

NO NOT RIGHT! It IS the cost of credit that is causing the down turn in property!
First time buyer rates approx 6.8%, on a average house=190,000 then that means
13,000 per annum on interest
with 44,000 income per average?! household.
=29.5% gross income on interest.
Last crash happened @ 25%

Mark, Exeter,

David,
you skillfully decided not to mention the Pound.
House prices are down 20% already in Euro terms.
Bread, milk and petrol are up by the same amount in Pound terms. Is this the soft landing?

George, Ealing,

Is this the sound of David Smith turning from bull to bear on the housing market?

Should I look in the Social and Announcements section for confirmation?

Paddles, London,

I'd like to see stats on disposable income. Prices of property, petrol, food and energy have all been rising fast. Inflation is rampant. Wages are not rising much. This must equal falling disposable income. We must stop spending an start saving. Maybe a recession is what we need.

Jake Brumby, High Wycombe, UK

People have short memories. When I began as a property lawyer in the late 1970's mortgage rates of 11 or 12% were the norm. In 1982/3 they rose to 14%. However, the cost of housing was affordable - that's the difference between then and now.

Michael Olmer, La Nucia, Spain

Dear David

I would like to suggest that a major issue is unemployment. As you rightly say that is a trailing indicator. I cannot see how in the short term or medium term unemployment can be avoided in the face of the loss of money provided for discretionary spendind by finance of all kinds.

Chris Stuart, Carentan, France